The Standard Deviation Is Generally More Useful Than the Variance

question 110

Multiple Choice

The standard deviation is generally more useful than the variance because:

• A)It is easier to calculate
• B)Variance is a measure of risk, where standard deviation is a measure of return
• C)Standard deviation is calculated in the same units as payoffs and variance isn't
• D)It can measure unquantifiable risk

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Definitions:

Economic Efficiency

The optimal allocation of resources to maximize the production of goods and services.

Creative Destruction

A concept in economics which signifies the process by which new innovations lead to the demise of older technologies, leading to economic progress.

Federal Trade Commission

A federal agency charged with protecting consumers and ensuring a strong competitive market by enforcing antitrust and consumer protection laws.

Wheeler-Lea Act

The federal law of 1938 that amended the Federal Trade Commission Act by prohibiting unfair and deceptive acts or practices of commerce (such as false and misleading advertising and the misrepresentation of products).